They're also waking up to results from the Iowa Caucuses, the first real verdict on the candidates running for the White House.
Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
1. Presidential hopes
1. Presidential hopes
Results from Iowa show Republican Ted Cruz beat Donald Trump. Hillary Clinton and Bernie Sanders are leaving the state in a virtual tie.
One thing is clear after Monday night: there's a long, volatile election season ahead before two deeply fractured parties can unite behind a nominee.
2. Stock market sell-off
2. Stock market sell-off
U.S. stock futures are falling by about 1% and many European markets are dropping by as much as 2% in early trading.
Asian markets all closed the day with losses, except two key Chinese indexes, which shot up during the day.
Investors have been especially downbeat since the start of 2016 as they worry about the consequences of low oil prices and China's slowing economic growth.
3. Market movers
3. Market movers
Alphabet, BP, Mattel, PVH: Shares in Google's parent company Alphabet (GOOGL, Tech30) are set to jump by as much as 5% at the open after the company reported an impressive set of quarterly results.
If confirmed, this move higher would make Alphabet the most valuable company in the world, surpassing long-time heavyweight Apple (AAPL, Tech30). Alphabet's valuation surpassed Apple's on Monday, but it didn't last for long.
The oil industry is also in focus after BP (BP) reported a dismal set of results. Shares in BP are dropping by 8% in London and other oil companies are also in the red. U.S. crude oil futures are down about 4% below $31 per barrel.
Shares in toymaker Mattel (MAT) are jumping by 6% premarket based on an upbeat earnings report. The company -- which sells Barbie, Hot Wheels and Fisher-Price brands -- has been in the midst of a turnaround.
And PVH Corp (PVH), which owns fashion brands such as Tommy Hilfiger and Calvin Klein, is seeing its shares shoot up by about 6% premarket after the company raised earnings expectations for the past year.
4. Earnings and market review
4. Earnings and market review
Exxon (XOM), UPS (UPS), Pfizer (PFE), Ferrari (RACE) and Michael Kors (KORS) are among the key companies reporting earnings before the open.
Companies giving updates after the close include Yahoo (YHOO, Tech30), Chipotle (CMG) and Match Group (MTCH).
It was a mixed day in the markets on Monday.
The Dow Jones industrial average dipped 0.1%, the S&P 500 was flat and the Nasdaq edged up by 0.1%.
5. Brexit coming?
5. Brexit coming?
Currency traders will be closely monitoring the British pound and euro on Tuesday as the president of the European Union, Donald Tusk, puts forward proposals to change the way the EU works.
The proposals are aimed at persuading the British people to vote to stay in the EU during an upcoming referendum, which could come as soon as June.
